QAP Workshop - Intro

Jill Cromartie 2/17/2021

Housing Finance & Development

Three Offices1. Housing Finance2. Portfolio Management3. Community Housing

HFDD – Office of Housing Finance

Housing Finance, Ryan FlemingTax Credit Manager Sandy Wyckoff

Multi-Family Underwriting Manager Robert Keeler

Construction Manager Sherrie Potter

Legal Officer Nikki Flanigan

HFDD – Office of Portfolio Management

Portfolio Management, Donna TylerCompliance Managers Tzwanza Taylor Lisa Vasquez

Asset Management Manager Stephen Vlkovic

Policy & Training ManagerGrace Graszer

Legal Officer Nick Sexton

HFDD – Office of Community Housing

Community Housing, Samanta Carvalho Federal Compliance

Environmental Davis Bacon and MBE/WBE Relocation

CHIP Manager DaTonya Lewis

HOME Program Manager Jimish Patel

HFDD 2021 Initiatives - Software

Three Modules:1. Underwriting/Allocations2. Compliance/Asset Management3. Loan Servicing

60% completeAnticipate full implementation by 6/30/2021

Summary of Portfolio

Total Properties: 1,333289 properties in development314 HOME loans

Summary of Portfolio - Units

Summary of Portfolio - Tenancy

Summary of Portfolio - Pipeline

Workshop Overview

Agenda

Presentations on Special Topics Large group discussion – any topic (15 mins break) “Virtual Stations” (15 mins break) Large Group Discussion

Accessing Sessions

Large group session 1

Accessing Sessions

Virtual Stations: “pop in, pop out” of small-group discussions

Accessing Sessions

Large group session 2: not the same link as the first large group session!

Accessing Sessions

Having issues joining one of the sessions? Email hfdround@dca.ga.gov

Slides

DCA staff developed two kinds of slides: Special Topics (e.g., “Bond Program Update”) QAP changes (e.g., changes in Core Plan, Competitive Pools)

We will not present “QAP changes” slides – these are for reference

Content focus was primarily upcoming 9% round But, all topics are fair game for Q&A and

commentary in the large group setting All slides will be posted to website (minor updates)

Today’s sessions are not recorded

Why? Today is about discussion, not guidance. Goal is to hold discussions that: Identify concerns from our partners Generate questions to be published in Q&A

You can only prepare your applications based on the Q&A, not what someone says verbally today

How to participate

Unmute yourself to speak (bonus points for this – in life, not the 9% round)

Type a comment in the chatboxWant to submit a comment anonymously? Email your question to Meagan.Cutler@dca.ga.gov and she will

will paste the question in the chatbox

Note: You might not be able to submit a comment directly! If you are in a “View Only” mode, email your comments to Meagan

Bond Alloca t ion & 4% Apps

February 17, 2021

2020 Bond Allocation

https://www.dca.ga.gov/sites/default/files/2020_allocation_activity_status_12-31-2020.pdf

❑ $1.09 Billion used by Multifamily in 2020

❑ Only $25M remaining 12/31/2020 – will be utilized by GHFA in coming years

2 0 2 0 B o n d A p p s ( 4 % )

63 LODs

Issued

$1.089 Billion

Bonds Allocated

$63.237 Million

Credits in LODs

❑ $1.18 Billion in bonds

for 2021

❑ First 9 months (Jan 1 –

Sep 30)

❑ Housing has

$500M

❑ $356 M in

Carryforward from

2018-2020, for 2021

❑ Will be utilized by

GHFA (Single Family)

in 2021

Current Pipeline (2020 QAP & Prior)

2021/2022 4% Outlook

4% fixed rate

❑Resubmissions

New 4% apps (2021 QAP Apps)

HOME/NHTF NOFAs

❑4%: 8-12 deals

❑9%: Only CHDO

2020 Scoring

February 17, 2021

2 0 2 0 L I H TC Ro u n d

39 Awards

8 Requests for

recons iderat ion

❑0 appeals

2 non-selects

over turned

❑Rural T ie Breaker

❑Geo l imi ts

Income Averaging

February 17, 2021

Income Averaging

Oct. 30 the Internal Revenue Service (IRS) issued a notice

of proposed rulemaking

DCA/NCSHA Response

Updated DCA Policy: https://www.dca.ga.gov/node/7238

Resyndication

Project Concept Change – Changing Set Asides

Change of Set Asides (Income Avg >> 40/60)

❑Updated Core App (AMIs)

❑Updated Market Study

❑ Letters of Approval from Lenders Investors

❑Relocation Plan Update – Does removing all of the 70%/80%

increase permanent displacements?

◼ RAD; URA requirements

❑9% deals – DCA score can not decrease

◼ (QAP – Mixed Income Points)

◼ Deeper Targeting – overall AMI of 58%

Project Concept Change – Changing AMIs

Change of Unit Mix (AMI Bands) – backing off of overall AMI %,

but not changing set aside from Income Averaging

❑Updated Core App (AMIs)

❑Updated Market Study

❑ Letters of Approval from Lenders & Investors

❑Relocation Plan Update – Does removing some of the 70%/80%

units increase permanent displacements

2021 Scoring

February 17, 2021

2 0 2 1 9 % Ro u n d

-November

Final Scores

-3/5/2021

-QD/Waivers

Pre-App

-5/21/2021

Full App

2021 Forms and Manuals Available

https://www.dca.ga.gov/safe-affordable-housing/rental-housing-development/housing-tax-credit-program-lihtc/application

Pre-App Workbook

Emphasys

Emphasys

❑ New platform for application and documentation submission

❑ 2021 Pre-Application documents will be submitted through

Emphasys

❑ Fees will not be processed through Emphasys at this time

◼ All fees are due at the time of Pre-Determination/Waiver Submission.

Please make all checks payable to Georgia Housing and Finance Authority

(GHFA). DCA will not accept any requests without the appropriate fees.

◼ Fees must be delivered to DCA Offices, 60 Executive Park South NE,

Atlanta, Georgia 30329. Please address all fees to the attention of

Stephen Barrett.

Registration

❑ Follow this link to register for Emphasys Developer account and

access Application Collector Portal, where you will submit

application documents

❑ Upon first visit to the Application Collector Portal, click “Register”

to create account

Pre-Application Submission in Emphasys

❑ Click “Fill Out an Application”

❑ Select “2021 9% Pre-Application Submission”

❑ Enter name of project

❑ Do not check box next to “Test application”

Pre-Application Submission in Emphasys

Example: Project Information & Fees Tab

Enter all known

info (* indicates

required field)

Indicate all

fees paid

Click to add

rows for

multiple fees

Attach proof of

payment using the

applicable file

upload buttons

Example: Architectural Standards Waiver Tab

Begin each file name

with the ID number

listed beside the

corresponding file

upload button

Submit Architectural

Standards Waiver Request

and all supporting

documentation in this tab

9% Q&A

9% Q&A

Post-workshop releasePublications will be small and incremental with no

email updates Will lessen time between submitting question and receiving

answer

Released in Word doc to allow sorting by category or release date

9% Q&A: Sorting by Date orCategory

9% Q&A

Discussion

Note on slides that follow:

The slides that follow were not presented at the

QAP Workshop. These slides primarily cover

changes from the 2020 QAP to the 2021 QAP and

are provided for reference purposes.

9% Competitive Round

Structure Changes

February 17, 2021

New Supply Competition

❑New Supply: a competition for applications proposing new

housing units

❑ From Definitions: “ ‘New Supply’ means Applications

proposing new construction or Adaptive Reuse.”

New Supply Competition

❑New Supply comprises three geographic pools

❑ Pools determine allocation of credits and, in certain cases,

differences in how scoring criteria apply

New Supply Competition

❑Note that “Metro Pools” is used throughout the QAP. This

refers to the “Atlanta Metro Pool” and “Other Metro Pool,”

as defined in Core Plan, Geographic Pools.

New Set Asides

❑ RAD Set Aside

❑Award to one Application that is approved by HUD to

proceed with a RAD conversion

❑See “XXI. Eligibility for Credit under the RAD Set Aside”

under Threshold

Rehabilitation Set Aside

❑Award to four Applications that propose rehabilitation of

an existing occupied Housing Tax Credit property

Credit Award Limits

Construction

QAP Changes:

Core Plan

February 17, 2021

Section 20. Monitoring and Compliance

Construction Services Department

A. Construction Monitoring

All Owners must contract with DCA-approved inspectors to

perform monthly inspections and complete reports in

accordance with the DCA inspection report form

All inspection costs are the responsibility of the Owner

Multiple visits to ensure compliance if necessary

Construction QAP

Changes:

Threshold Criteria February 17, 2021

XIV. Community Service Facilities

Construction Services Department

Construction/Underwriting Review Documents Needed

Current year DCA Schedule of Values in both PDF and Excel formats

Letters of Intent from all participating service providers

Full CSF Narrative that details all uses, lease terms, and costs of services

that demonstrates compliance with all Section 42 and DCA CSF

requirements

XVII. Building Sustainability

Construction Services Department

Revisions Made❑ Definitions and language pulled from Georgia State Minimum Standard

Energy Code (International Energy Conservation Code with Georgia State Supplements and Amendments) to better align section with industry standards

❑ Clarification given to discern difference between mid and high-rise residential construction for duct leakage along with dwelling unit air infiltration.

❑ Applicants must complete DCA’s virtual Building Sustainability Training athttps://www.youtube.com/watch?v=VozXGGf8Ueg&t=503s

Relocation

February 17, 2021

We have a New Relocation Team

❑We are located in the Office of Community Housing Development

under Samanta Carvalho

❑Comprised of Shirin Wilkerson and Ilona Nagy

New Manual Format

❑Vetted by a diverse Focus Group of Development Peers

Clarified Regulations

❑ Including URA and non-residential assistance

Relocation Updates

Updated Notices and Forms

Two new matrices with clear actions

❑Eligibility for Assistance and Return

❑Lease Termination and Non-Renewal

Relocation Updates

Plan ahead: Interview residents in advance of application to know if

they qualify to return and if you need to adjust your unit mix and/or

adjust funds.

Remember: Your funding sources determine the strictness of

relocation requirements, with federal funds triggering URA and

additional requirements.

Consideration of relocation and displacement effects on tenants.

Relocation Take-Aways

Environmental Review

February 17, 2021

Common Environmental Concerns

Floodplain

Wetlands

Historic Preservation

Noise

Floodplain

In accordance with 24 C.F.R. Part 55.1c1 and 55.2 with definitions

at 24 C.F.R. 55.2b

DCA will not approve projects in Coastal High Hazard Areas or

Special Flood Hazard Areas

Special Flood Hazard Area (also called the 100-year floodplain)

has 1% probability of flooding any year

2021 Environmental Manual – Floodplain

Wetlands

Projects will not be accepted for any DCA funding or approved for

tax credits if the proposed development will disturb any aquatic

resources (ex. streams or wetlands) on the subject property or on any

adjacent property without evidence of prior review and concurrence

of the delineation by the U.S. Army Corps of Engineers (USACE).

If USACE prior approval is not required for impacts to aquatic

resources, adequate explanation and supporting documentation must

be provided.

2021 Environmental Manual - Wetlands

❑ Wetland and Floodplain

❑ Required document:

If small portion of Wetland or floodplain located on the

subject property and even though site plan shows no impacts

will be anticipated to the wetland or floodplain, Site Drainage

Plan and Permanent Covenant are still required at the closing

to preserve the wetland or floodplain according to the

requirements of 24 C.F.R.&55.12 (c)(7)

Wetlands and Floodplain

Historic Preservation – Federal or State Review?

S106 Review (Section 106 National Historic Preservation Act)

For applicants applying for Federal funding (HOME, NHTF, and

CDBG-DR)

GEPA Review (Georgia Environmental Policy Act of 1991)

For applicants applying for low-income housing tax credits

without Federal funds

Historic Preservation – Federal or State Review?

Submit both S106 and GEPA to

DCA’s Historic Preservation Division

(HPD) for review and comment.

HPD is the Georgia State Historic

Preservation Office (SHPO), the

required consulting party to federal

or state agencies in both the S106

and GEPA review process.

“Adverse Effect” for Section 106 reviews

“Significant Impact” for GEPA review

Require more steps in the process: (Memorandum of Agreement,

archeological survey, archival photos, etc.) which may involve

additional time and expenses

HPD can provide samples and list of qualified historic

preservation professionals to assist

What if the project gets a Historic Preservation

adverse effect?

Noise

The DCA and HUD Noise Limitations are 45 decibels (dB) for interior

locations and 65 dB for exterior amenities

For HUD funded projects submitted to DCA, all new construction and

rehabilitation projects must also meet the requirements set forth in

the HUD noise regulations, 24 C.F.R. 51b.

Applications for rehabilitation may request a waiver from HUD

Noise Limitations.

Required document:

◼If the subject property (measured from the property line

including the exterior amenities) is within the distances of

noise sources, the Environmental Professional must complete a

noise assessment in accordance with the HUD Noise

Assessment Guidelines(‘NAG”) and 24 C.F.R & 51.100 et

seq.

◼Noise Attenuation is required for both new construction and

substantial rehabilitation that has noise above 65dB.

Noise

❑ For GEPA review: 30-day review for HPD’s initial response letter &

may include more time to address other Environmental items

❑ For NEPA review (for HOME or CDBG-DR): up to 85 days

❑30-day tribal consultation

❑15-day public comment period

❑20 to 40 days for HUD clearance

Questions about the environmental reviews, contact Joanna.Jin@dca.ga.gov

Typical Timeframe for Clearing ERs

MBE/WBEMinority-Owned & Women-Owned Businesses

Outreach

February 17, 2021

❑ Required for HOME and National Housing Trust Fund (NHTF) funded developments

under Executive Orders 11246, 11625, 12432, & 12138

❑ To the maximum extent possible, MBE/WBE must be included in all contracts

❑ Outreach plan must:

❑ Inform the public about contracting opportunities

❑ Promote contract opportunities to MBE/WBEs in local electronic/print media

❑ Identify & maintain an inventory of certified MBE/WBEs services/supplies/products

Questions about MBE/WBE, contact Amber.Riley@dca.ga.gov

Minority-Owned & Women-Owned Business Enterprises

(MBE/WBE) Outreach Plan

Section 3 Outreach

February 17, 2021

❑ Required for HOME and National Housing Trust Fund (NHTF) funded developments

under 24 CFR Part 135

❑ Preference for all opportunities must be given to qualified low and very low-income

residents

❑ Requirements:❑ Provide a list of aggregate workforce on this project❑ Any changes to that workforce will constitute NEW hires ❑ You must notify DCA and contractors of any new hire opportunities as they arise

Questions about Section 3 contact Amber.Riley@dca.ga.gov

Section 3 Plan

Davis Bacon

February 17, 2021

❑Required for HOME-funded developments under the Davis

Bacon Act

❑Requires paying the local prevailing wage rates

Questions about Davis Bacon contact Amber.Riley@dca.ga.gov

Davis Bacon

Project Team Qualifications

February 17, 2021

Requirement

❑ Project Team Qualifications may be reviewed at Pre-App

or Application Submission for 9% Applications

❑ Project Team and Construction type must be finalized, not

TBD, to receive QD review

❑ Pre-App Advantage - Ensure project team is qualified

before submitting application

❑Note that QD Review is still required during Pre-App for

4%/bond Applications – See Core p. 16 for timing

Certifying Entity

❑ Project Team must have Certifying Entity for the

❑General Partner and

❑Developer

❑Must exercise effective control

❑Majority Interest

❑Managing Member

❑ Legal opinion for alternate structures

Experience

❑20% minimum interest in GP and/or Developer for 5

Successful Tax Credit Projects (“STCP”) (10 if Significant

Adverse Event waiver)

❑Participation from Allocation to present

❑Placed in Service per 8609s after January 1, 2010 (based on date last building PIS) new

❑Minimum 90% occupancy

❑Cannot combine experience of different entities or

Principals

Required for Each Qualifying Project

Letter from Syndicator certifying role and interest (the

relevant Limited Partnership Agreement is not a substitute)

8609 forms or Certificate of Occupancy

Applicant-certified trailing 12-month occupancy reports

Significant Adverse Event Waiver Request

Requires Waiver Form

Must be submitted during pre-app QD review

Must include

❑ Narrative and

❑ Third party supporting documentation

Requires ownership and development of 10 successful LIHTC

projects

Grandfathering Determination

❑ Submitted documentation of experience in 2020 and

received determination of “Qualified”

Provide 2020 QD letter or applicable pre-app/app

number

Not required to submit experience documents for 2021

Must complete all other sections of the Performance

Workbook

Not Qualified – Partnering With a Certifying Entity

Entities with insufficient experience

❑Must partner with an experienced GP and

Developer

❑May be subject to additional conditions or

restrictions

Still subject to other parts of QD review

Probationary Participation

Entities with material participation in at least 3 LIHTC

projects but not requisite ownership or development

experience

Ownership or development experience in >2 but <5

Successful LIHTC projects

❑Additional documentation required

❑May be subject to additional conditions or restrictions

Significant Changes

Qualifying Successful Tax Credit Project for Experience

◼ Date no longer based on Project “Completion”

◼ Date based on last building’s PIS date

Applicability of

Scoring

Applicability of Scoring Criteria

❑ For 2021 QAP, intent was to have separate competitions by application type,

to align scoring criteria with property context.

❑ Example: Rehabilitating highly occupied properties was a DCA priority for

rehab applications, but this is not applicable to new construction

applications.

“Table of Applicability and Maximum Points” provides an overview of which

sections apply to which competitions (9% vs. 4%, New Supply vs. Rehab, etc.).

Desirable/Undesirable

Activities

Desirable/Undesirable Activities

New scoring structure

❑Each activity/characteristic assigned to either Group 1 or Group 2

❑Points are determined by Competitive Pool, Group and distance

from site (example below)

Desirable/Undesirable Activities

Desirable Activities

❑New - Public park/public community garden now split into “less than

25,000 sq ft” and “greater than 25,000 sq ft”

Food Desert

❑New – Point deduction will not be applied to properties qualifying

for supermarket or grocery store Desirable point

Community

Transportation Options

Community Transportation Options

Adjustments to ways to qualify based on proximity to transit hub

(subsection A, option 2):

Community Transportation Options

Multi-stop express routes providing regional transit now eligible, but

only under subsection B.

Quality Education

Areas

Quality Education Areas: Changes

❑ Point Claiming Eligibility

❑ This section available to all applications regardless of points claimed in

other sections.

School Eligibility

❑ Schools for which student admission is conducted on a selective basis (e.g.,

lottery, competitive application) are not eligible.

Quality Education Areas: Changes

CCRPI Scores

❑Only scores posted since the 2018 CCRPI update qualify under this

section

Table of school eligibility by qualifying grades:

Quality Education Areas: Changes

Minimum Documentation

❑ If submitting a letter evidencing the site is within school district

boundaries, the letter must include the project name and location.

❑For each charter school, applicants must submit a letter from a

charter school system representative not more than 6 months old

confirming that admissions is not conducted on a selective basis, that

residents in the attendance zone are able to attend as of right.

Quality Education Areas: QAP Amendment

Note: QAP amended since Governor signed

Issue: no standardized testing due to pandemic, resulting in no 2020

CCRPI or “Beating the Odds” reports

❑Applicants may qualify for points using data from 2018 and 2019

Click here to view amendment announcement

Quality Education Areas: Common Mistakes

School district map(s) must show the site location and the full

attendance zone boundaries

All grades K-12 must meet CCRPI or BTO criteria to receive points for

“All K-12”

❑Review all schools in your area: primary schools, elementary schools, middle school, 9th grade academy, junior high school, senior high school, etc.

If submitting a letter evidencing the site is within school district

boundaries, the letter must come from a school district representative

Revitalization/

Redevelopment Plan

A. Revitalization Plan/Qualified Census Tract

Point Claiming Eligibility

❑ Applicants are ineligible to claim points in Revitalization/Redevelopment Plans if claiming points in Stable Communities or Community Designations (New)

Revitalization Plan Criteria

❑ Be officially approved or re-approved by a Local Government within 10 years of Application Submission (previously 5 years)

❑ Local Government solicited public input and engagement during CRP creation prior to day of adoption (clarifying that solicitation must occur prior to day of adoption of CRP)

❑ New – point option if Local Government demonstrates financial commitment to advancing the CRP in the form of funds raised, funds allocated, tax incentives, or local government fee waivers

B. Third-Party Capital Investment

3rd-Party Investment/Improvement Eligibility

❑New – Improvements that were completed within 5 years (previously 3 years) prior to Application Submission are eligible for points in this section

Points Scale

❑New – Points awarded based on investment amount per unit (previously percent of TDC)

Minimum Documentation

❑Timeline for completion must come from unrelated 3rd-party

Community

Transformation

❑ Point Claiming Eligibility

❑ Applicants are ineligible to claim points in Community Transformation if claiming points in Stable Communities or Community Designations

Community-Based Developer

❑New tiebreaker: In the event of a tie, DCA will prioritize projects based on the tiebreakers outlined in Core Plan, Evaluation of 9% Tax Credit Competitive Applications, subsection D. Selection ◼Previous: projects that leverage DCA resources to the greatest extent

Community Transformation

Equitable Allocation

❑ Applicants will be rated less competitively in this selection process

if:

❑ New – The Project Team member associated with the submitted partnership letters was awarded Community Transformation points for an application awarded 9% Credits in 2018, 2019, or 2020

Minimum Documentation

❑ New – Map clearly displaying boundaries of the Defined Neighborhood

Stable Communities

Stable Communities

Point Claiming Eligibility

❑Applicants are ineligible to claim points in Stable Communities if

claiming points in Revitalization/Redevelopment, Community

Transformation, or Community Designations

B. Local Health and Economic Indicators

New Scoring Table

Points below can be claimed based on any combination of metrics

❑ Example, both of next bullets qualify for 2 points:

◼ “Life Expectancy” and “Unemployment Rate” both > 60th percentile

◼ “Health Insurance Rate” and “Median Income” both > 60th percentile

B. Local Health and Economic Indicators

Applicants within a census tract for which there is no data may use the

nearest census tract with data, if said tract is within .25-miles of the

site

Data table posted to DCA website – updated 1-15-21 per ACS data

updates

❑Applicants may claim points based on values from either before or after the data update, but not both (ex: claim points based on all 2018 values or all 2019 values)

❑There is only one set of data for Life Expectancy, as the CDC has not conducted an update to this data

Community

Designations

Community Designations

Point Claiming Eligibility

❑Applicants claiming points in this section are ineligible for points

under Revitalization/Redevelopment, Community Transformation

(New), and Stable Communities.

Phased Development

XII. Phased Development

Point Claiming Eligibility

❑New - Both Metro Pool and Rural Pool applications eligible

Previous Projects

XIII. Previous Projects

A. 15 Years Lookback Period

❑New – option 2.

◼ 4 points will be awarded if the proposed development site is within a current Local

Government Boundary that has received 1 9% Credits award within the last 15

DCA Housing Credit Competitive Round. To qualify, the most recent 9% Credits

award must have been received prior to January 1, 2015.

DCA Community

Initiatives

XVI. DCA Community Initiatives

❑ Alumni Eligibility

❑ Alumni GICH Teams which have not successfully completed a

GICH Alumni Certification application in 2020 or 2021 are

ineligible for the point in this section (previously “within the

previous two years”)

Underserved Populations

A. Supportive Housing Programs Match

❑ New section structured to award points to a select number of

applications well suited to recipients of DCA housing assistance

programs based on property location and development team

experience.

❑ The highest scoring applications will receive 2 points towards their

9% application.

A. Supportive Housing Programs Match

❑ Applicants fill out the “Housing Assistance Competitive Ranking

Form” and submit this as Minimum Documentation, in addition to

any supplementary documentation.

❑ The Form also provides clarifications for certain ranking criteria.

The “Competitive Ranking Overview” provides an overview of how

DCA staff will conduct the review.

Both forms are posted to the 2021 QAP and Related Documents

webpage (click here).

B. Tenant Selection Preference

❑ Points for application with a Section 8 PBRA commitment from a

Public Housing Authority that has a tenant selection preference in

voucher programs for persons with disabilities identified in the

Settlement Agreement (#1:10-CV-249-CAP).

❑ Rental assistance must be provided for no less than 5 years from

the Application Submission Deadline date.

Rehabilitation Set Aside

Scoring

Occupancy

❑ Applicants may claim points if the application property exhibits

monthly occupancy over 24 months within the ranges below:

❑ Note: points are awarded based on occupancy prior to

Application Submission, not expected future occupancy

Tax Credit Restrictions

❑ Applicants may claim points if the proposed property has current

tax credit restrictions that were applied during the calendar year

ranges below, as determined by the executed LURC:

Property Age

❑ Applicants may claim points if the proposed property’s placed

in service date was within the time frames below:

Property Size

❑ Applicants may claim points if their application proposes a unit

count within the following ranges below.

Compliance Monitoring

February 11, 2020

Compliance MonitoringAppendix III Procedures, Requirements and Penalty Criteria

New Policy! Financial Reporting Requirements for properties

Section F.

LIHTC with a GHFA Loan (HOME)

Annual Audited Financial Statement Requirement:

Every property funded with Low Income Housing Tax Credits and financed with a GHFA loan (HOME, TCAP, etc.) must submit

audited annual financial statements, prepared by a licensed Certified Public Accountant, and form Schedule A to DCA by

May 15th or as otherwise required by DCA.

All financial statements must be submitted electronically. Paper financial statements will not be accepted. Properties must

continue to submit audited annual financial statements until the loan is paid in full.

Each property is required to submit annual financial data as stated in this QAP, utilizing DCA reporting tools as required

and described in DCA’s policy documents, memorandum notices, Compliance Manual and Asset Management Manual.

Annual financial reporting must begin once lease-up commences and after the first financial year of operation has

ended.

Compliance MonitoringAppendix III Procedures, Requirements and Penalty Criteria

Financial Reporting Requirements for properties

Section F. continued

All Properties

Annual Financial Reporting:

Every property funded with Low Income Housing Tax Credits must submit annual financial data. Annual

financial data/Year-end financial data is due no later than May 15th of the following year.

Quarterly Financial Reporting:

Every property funded with Low Income Housing Tax Credits must submit quarterly operating data.

Compliance MonitoringAppendix III Procedures, Requirements and Penalty Criteria

Financial Reporting Requirements for properties

Section F. continued

Quarterly financial data is due within 45 days of the last day of the month following the end of the quarter.

Each property is required to submit the financial data as stated in this QAP, utilizing DCA reporting tools as

required and described in DCA’s policy documents, memorandum notices, Compliance Manual and Asset

Management Manual.

This requirement is effective through the end of the Extended Use Period or Affordability Period, whichever is

later.

Quarterly financial reporting must begin once lease-up commences and after the first financial quarter of

operation has ended.

During the course of monitoring, if a property demonstrates financial or physical distress, DCA may request

additional financial documents for the identification of possible solutions.

Compliance MonitoringAppendix III Procedures, Requirements and Penalty Criteria

New Policy! Management Company Approval

Applicants must ensure the management company included in all applications is approved per DCA’s

Management Company Approval policy by the deadline specified in Core Exhibit A.

If the management company is not approved by the deadline, the applicant will be required to

replace the management company in the application with a management company that is approved.

For any anticipated change in a management company, beyond the initial application for funding, the

ownership entity must submit a request for approval of the change per DCA’s Management Company

Approval policy.

DCA will provide an online publication of the Approved Management Company List to be updated

quarterly no less than twice per year

Compliance MonitoringAppendix III Procedures, Requirements and Penalty Criteria

Management Company Approval continued

DCA will not approve management companies if the following conditions exist:

❑ Management company is currently barred or suspended or has been barred or suspended by any

state HFA

❑ Management company in the five years prior to the submission of an approval request, received a

final decision that a discriminatory housing practice has occurred as determined by a court, the U.S.

Department of HUD or has been found guilty of discrimination by any government agency on any

affordable housing property.

❑ Management company is performing third-party management without a licensed brokerage in

Georgia

Compliance Performance

Scoring

February 17 , 2021

Significant Adverse Event (SAE) Waiver Form

Important notes:

SAE waiver requests must be filed at Pre-Application within the same folder that contains the

Performance Workbook and Questionnaire

No fee is charged for SAE waivers

Each SAE waiver request requires a separate SAE Waiver Form

Instructions are included in the Performance Workbook for naming conventions for the SAE

Waiver Form and Supporting Docs

For SAE waivers approved by DCA prior to 2021, a copy of the DCA approval letter must

have been submitted along with the Performance Workbook at Pre-Application

New in the 2021 QAP - Litigation is now characterized as an Adverse Circumstance (AC)

which only requires written explanation, and does not require the filing of an SAE Waiver

Request Form

Compliance Performance - Scoring

Important notes:

Be mindful of the applicable DCA lookback period for each Significant Adverse

Event (SAE) or Adverse Circumstance (AC)

SAE Waivers if granted by DCA, will still carry their corresponding point

deduction in this section

Applicants are strongly advised to claim the maximum add-back points based

upon your GA portfolio size in this section, even if you believe there are no

possible deductions for SAEs and ACs in this section.

For add-back points: Applicants may include a cover sheet for this section stating:

“Applicant is not aware of any point deductions for SAEs or ACs, but is claiming

points in the event DCA discovers any SAEs or ACs during Application scoring”

Compliance Performance - Scoring

Important notes, continued:

The two (2) point penalty for late or unfiled AOCs will be deducted

against the beginning 10 points in this section

Any 2020 AOC’s filed after March 1, 2021 are considered late

and will be penalized two (2) points per property in this section

DCA has improved access to administrative and other non-

compliance data related to SAEs and ACs

Common Non-Compliance issues

❑ Failure to provide a minimum of 30 days advance notice to

DCA and/or obtain pre-approval of a Management change

❑ Late AOC filings (if filed after March 1, 2021) or incomplete

AOC filings

❑ Uncorrected/uncured findings of noncompliance reported on

IRS form 8823 or listed in the DCA Findings letter or close

letter

❑ Amenities listed on LURC/LURA not provided or available as

required

Compliance Performance - Suggestions

Helpful hints:

❑ Submit for the maximum number of add-back points that corresponds to the number of successfully developed and currently owned Georgia DCA affordable properties, even if you do not believe you will be assessed any deduction points in this section

❑ Indicate in the Core Application any add-back points you can claim relative to the number of successfully developed and currently owned Georgia DCA affordable properties

❑ Comments in the Core App can state that you are submitting for add-back points in the event DCA discovers any non-compliance that may result in point deductions in this section

GHFA

Underwriting

February 17, 2021

Loan Payment Options

Loan Payment Options

Amortizing

❑Can be from 20-40 years depending on required DSC requirements.

Cash Flow

❑Payment due annually subject to available cash flow. Only available to select applications.

DCA HOME IPS

❑Requires some monthly payment, usually sized to maintain DSC throughout the loan term.

HOME Unit Considerations

PBRA

❑High HOME/60% AMI units – restricted to LIHTC max

❑ Low HOME/50% AMI units– can take max PBRA rents

◼Minimum 20% of HOME units

◼May want to “over-designate” to get max PBRA rents

Environmental Clearance

❑Site Control – extend contract for HUD clearance

Fixed & Floating Units

Uniform Relocation Assistance and Real Property Acquisition

Act (URA)

❑Voluntary

Acquisition

◼ (Pre-Contract

Agreement) -

Informing Seller of

Fair Market Value

◼Right to Withdraw

HUD’s Cost Allocation Tool – Proration Method

https://www.hudexchange.info/resource/5190/home-cost-allocation-tool/

Start with Investment Amount $ -- How many units

needed?

Purpose – to ensure enough HOME/NHTF/CDBG

units are on the property to justify the loan/grant

given to the development

Base Cost % - How many units for each bedroom

size

Investment/Subsidy Limit

HOME Subsidy Limits

https://www.hudexchange.info/resource/2315/home-per-unit-subsidy/

HOME Subsidy Limits

X 240%

Maximum Subsidy & DCA Hedge

-It is DCA internal policy to increase the Units Needed by 10%

- So 11 units needed would go to 12.1 (rounded to 13),

adding 1 1BR unit and 1 2 BR unit

-This accounts for any disputable costs and changes in costs

Maximum HOME invested

Subsidy Limits

NHTF - The HTF regulation [24 CFR 93.300(a)] requires grantees (states) to establish the

maximum amount of HTF funds that may be invested per-unit, with adjustments for the

number of bedrooms and the geographic location of the project. The regulation requires the

maximums be reasonable and based on actual costs of developing housing in the area of

the project.

❑NHTF – DCA matches subsidy limits for HOME units

CDBG – all tax credit (LIHTC) units are designated CDBG units, since CDBG income

requirement is 80% Area median income

TCAP – no subsidy limit